More entrepreneurs borrowing from banks for expansion

Its either banks have been lending more or there are more Filipinos borrowing from banks to finance their businesses for the first half of 2011.

A report from the Bangko Sentral ng Pilipinas (BSP) showed that loans from commercial banks have steadily grown at double-digit growth rates since January this year.

“Loans for production activities-which comprised more than four-fifths of commercial banks\\\' total loan portfolio-expanded by 20.6 percent in June from 19.0 percent (revised) a month earlier. Meanwhile, the growth in consumer loans decelerated to 14.1 percent from 14.9 percent due to the slowdown recorded in the growth of credit card receivables and auto loans by 6.2 percent and 25.8 percent, compared to 9.1 percent and 29.0 percent in May, respectively,” the report said.

Based on the loan portfolios, most of the loans were used for expansion in real estate, renting and business services, which grew by 20.4 percent; manufacturing, growing by 17.1 percent; wholesale and retail trade, which is steadily growing at 20.3 percent; and transportation, storage and communication, which grew by 23.7 percent.

The sustained expansion in bank lending during the month supports the view that financial conditions are stable and that the domestic economy is growing within a sustainable economic path.

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